Member Info for CF73

Am in agreement BENJAN1, sale of our entire stake is looking likely. Once tariff lands, we will move quickly from there, in my view.

We know they in sensitive negotiations over tariff, the key value determinent of the project. Company have officially said that they have to weigh up market expectations for news with the sensitivities involved in these negotiations. Specifically;

"Finalising the tariff will unlock all the remaining milestones and while we aim to provide updates as regularly as possible, we must balance this with the sensitive nature of such negotiations."
https://www.investegate.co.uk/ncondezi-energy-ltd--nccl-/rns/project-update/202103250700084117T/

In other words, this radio silence is no secret and should be expected. Until tariff talks are sorted, there is nothing else they can report. And my guess is that we aren't far off.

Gary, the first thing the RNS does is tell me that NCCL is actually in a stronger psoition than then market has thought. The second is that plans for Solar are even bigger than we realised. Finally, there are hints in the RNS:

"Finally, as we continue to progress the baseload and renewable energy C&I sides of our business it is becoming increasingly clear that they attract different investors. The Company has initiated an internal review to identify the optimal strategy to ensure both the baseload power and renewable energy C&I businesses are able to achieve their full value for shareholders."

I believe this points to NCCL selling their stake. Hanno had in a previous interview/ investor call said that selling some or all of that 40% could happen. In today's investment climate/ enoinrment, is easier to invest in green energy than fossil. NCCL and shareholders can take their windfall (if sale happens) and 'choose' to reinvest in the solar side. I would personally want the ability to choose, meaning that I want the option to cash-in/ take cash for shares (i.e. redistribute capital return to shareholders).

Worth adding, that NCCL have the listing so the new green venture would have a pre-existing corporate platform.

All in all, as far as am concerned, we in a much stronger position than some would think. I also sense that there is considerable confidence about the main project too.

This news, while not the main project (with the main project still being the main draw), is pretty BIG. Shows the solar side is a serious interest and is expected to be a signficant business. It also hints at possible sale of our stake in the project, in turn suggesting that everything is expected to go conclude positively.

CMEC are now firmly operating in the Solar and Energy Storage sector. If NCCL scale up quickly, then the entire package becomes appealing, as NCCL will have done the early groundwork (in Moz) and CMEC can then step in and scale up to another level.

The main thing for me is that the first of the solar project's is going well. Get that over the line, realise revenues and stabilise foundations, while we wait on the main power project. We know thet at a key haggling stage with the main project. And we know that project's like this are now happening in Moz (i.e. they have prior/ present form, in seeing major Billion$ projects into construction - referring to the Gas-to-power-plant project now in construction).

The gas-to-power-plant project in the South demonstrates that projects on that can and do happen. That project is in the South. It is not sufficient on its own to meet Gov overall targets, not to mention regional needs within Moz, with our plant solidily in the west of the country, supporting Tete and surrounding area, as well as, critically, supplying power to Malawi.

The Southern project is not a threat to our Tete project; and, indeed, dispels the idea that things can't get done in Moz/ Africa.

Extremely positive news, this!

#NCCL This News (1wk-old) demonstrates very clearly Billion$$$ projects like ours do cross the line into realistation and construction, this news just a week old, on the Gas-to-power-plant project, Suthern Mozambican province of Inhumbane (we in the c.West).

This gas-to-power-plant, including transmission, project looks so similar to our coal-to-power-plant project with transmission!!

This is a key sign. I do believe we further ahead than many folks realise!

---

Mozambique launches construction of $1 bln power plant, transmission line

By Reuters Staff

2 Min Read

MAPUTO, May 31 (Reuters) - Mozambique on Monday began construction of gas-to-power plant and transmission line projects worth $1 billion in the southern province of Inhambane as the government aims to boost energy supply.

The World Bank is one of the financing partners of the infrastructure projects, alongside the United States, Norway, African Development Bank (AfDB), Islamic Bank and The OPEC Fund for International Development, according statements from the World Bank and the U.S. embassy.

“Today we mark a milestone in the framework of this endeavour to illuminate Mozambique. Our governance aspires that more than 10 million Mozambicans will have access to electricity for the first time in their homes by 2024,” Mozambique President Filipe Nyusi said at the launch of the project.

Upon completion, the gas-to-power Temane Thermal Power Plant will have a capacity of 450 megawatts.

Advertisement

“Today, we are witnessing the exceptional beginning of a vision that aims to provide energy for all Mozambicans: this is a transformative project for the country,” the representative of the World Bank in Mozambique, Idah Pswarayi-Riddihough, said during the launch.

U.S. Ambassador to Mozambique Dennis Hearne said the United States was supporting the Temane project through a $200 million direct loan for its construction via the U.S. International Development Finance Corporation (DFC).

“In addition, thanks to the support of the U.S. government’s signature Power Africa program, we are providing a “transaction advisor” assigned to EDM (Mozambique power utility Eletricidade de Moçambique) to help bring the critical Temane Transmission Line Project to financial close,” said Hearne. (Reporting by Manuel Mucari Editing by Bill Berkrot)

Is crazy that CMEC have agreed in principle to Historic Costs owed to NCCL of $26.7m ($21m audited for now), which is twice NCCLs market cap. Then add everything else!!

#NCCL Hugely undervalued, Market Cap £11m when,

1. NCCL, CMEC and EDM at very advanced stages of main Billion$ power project negotiations, including tariff. No further info required, just pkain haggling over the price.

2. Partners CMEC agree, in-principle, Historic Costs of US$26.7m owed 2 NCCL (compare to market cap!)

3. Solar Project commissioned end of June (this month!), revenues thereafter ($17, 000 per month).

4. Low free float (just on NCCL Significant shareholders page, 50.85% in very strong hands). Another 25% + in hands of LTHs. So, am guessing a minim of 75% in strong to very tight hands!

Momentum building here!!

I see 10p+ on tariff approval. Whilst more negotiations and haggling beyond tariff, especially the subscription price (and even full on sale), tariff is the most fundamental value within the project and is why is taking so long.

Set up for good week next week. Can see NCCL passing 4p mark fairly quickly as so undervalued presently.

Agreed, G_G_G --- the SP will explode on tariff agreement :-)

#NCCL Currently negotiating tariff. No other info required. Just plain honest haggling. Once tariff lands, this will fly, as tariff agreement confirms project economics, enabling other values such as what CMEC have to pay to NCCL in terms of subscription price - or even outright sale.

#NCCL Market only just cottoning on that to be involved with the partners we are and to be working with them in negotiating the tariff with Moz's key national utility, is to be at a very VERY advanced stage.

It signals to me not an 'If' (as in a binary bet) but an 'How much...'.

All parties want the project to happen because it will generate growth for all the parties concerned - they just got to get the price right.

When a project like the Ncondezi Power Project, working in partnership with a global Chinese giant, reaches the point of sensitive tariff negotiations with a national utility, where no further info is required for the current discussion, and is just plain solid negotiation, then should be obvious that the project is in a very advanced stage.

We are right now haggling over the price, literally.

hxulcolrdoh, naturally, until those are known, they remain unknowns - just as all the other projects that have eventually come on line.

The trick is to see what is happening in and around the project, including and particularly, who is involved.

- We have CMEC involved, representing the Chinese state (CMEC having delivered countless projects like these);

- We have Africa Finance Corporation as our second largest shareholder (who themselves fund these sorts of projects, and have seen to completion projects such as these across Africa);

- We have Polenergia, third largest shareholder, who are the largest private power provider in Poland;

- We have World Bank, and German and Norwegian Governments, who have approved $127m for transmission infrastructure running next to our project (where have just been given permission EDM and - am guessing, CMEC - to undertake transmission connection work). I have had contact with World Bank. They fully expect/ intend this work to go ahead, connecting power from a source in Tete!

- Where we have an agreement in place for Malawi to take power (as part of SAPP) carried by that transmission infrastructure, from a source in Tete (confirmed to me by World Bank), where we are the only advanced project, where all other projects have fallen away

- Where the Moz Power Plan involves 1200MW to come out of Tete coal, where we are located and where there are no other such advanced projects in the region (300MW to come on line 2023/ 24 and a further 300MW by 2026);

- Where we have been told that all information regarding the tariff, as needed by Moz authorities/ EDM, has been provided, where - we have been told formally/ officially - we are now simply negotiating over the tariff, essentially negotiating over the price (where the final tariff will have bearing a subsequent set of values, including subscription price and even an outright sale).

Just as with all other projects that eventually happened, until we are told, various elements remain unknown. That is part of the process. Nothing unique here. Instead, is about what you/ we can learn from all the information out there. And there is a lot! And we can see with these articles, projects are happening, progress is being made, and there is political will – and we are at an important stage of negotiation over the tariff, where we will get ‘feedback’ when the tariff is finally agreed. There is no other feedback.

Two very recent news articles on Moz power needs and progress:

Moz have a 5 year plan (2020-24) and are moving on it. That plan involves 300MW coming our Tete coal by 2024. They also have a longer temr plan, with universal access by 2030, by whch time we have a further 300MW coming from our Tete project.

----------------------

[This article from 06/05/2021]

"The government in Mozambique has mobilised $280 million to implement its Energy for All programme that will see 400 000 households be linked to the electricity grid for the first time."

"The money was mobilised from the government’s cooperation partners and is intended to provide electrical power to every household in the country."

[...]

"“There’s a lot of support from the public. They want access to electricity,” said Bernardo, who recalled that the government’s Five Year Programme for the period 2020-2024 set a target for increasing the number of people with electricity in their homes from 34 to 64 per cent of the population."

[...]

"President Filipe Nyusi launched the programme in November 2018. The ambitious target of ensuring universal access to electricity by 2030 will require the government to mobilise about six billion dollars."

https://www.esi-africa.com/industry-sectors/transmission-and-distribution/mozambique-400000-households-to-be-linked-to-electricity-grid/

----------------------

[An even more recent article 01/06/2021, shows political will and progress, with projects moving starting/ forward]

"Mozambique’s president, Filipe Nyusi, on Monday reaffirmed the goal of bringing electricity to the homes of 10 million Mozambicans by the end of 2024."

https://www.macaubusiness.com/mozambique-president-wants-to-bring-electricity-to-10-million-by-2024/
“Our governance aims that more than 10 million Mozambicans have access to electric light for the first time in their homes by 2024,” he said, considering energy as the key to the country’s development."

----------------------

We are sensitive negotiation stages with the tariff. Getting tariff right is not only a benefit for Mo and CMEC, but for NCCL. Can imagine that the better the tariff, the higher the subscription price and even the outright sale price.

This so called 'feedback' on tariff will only come when the tariff is agreed. Right now, this is them haggling over the price. Their '...awaiting feedback', is pretty much all they can tell us in the meantime, until all parties have come to an agreement. Our not hearing about it yet, is not the same as a lack of progress. Meanwhile, these articles show projects and programmes are moving forward, that there is a demand and appetite in Moz for power and that there is political will, not to mention the involvement of massive partners, parties and donors!

Some very recent good news articles on power needs and progress in Mozambqiue. Moz need and want the power and are moving in the right direction. Their 5 year plan involves 300MW coming out of Tete, derived from coal, where no other projects. They have a longer term plan, involving universal access by 2030 when there will be a total proposed 600MW from our Tete coal.

-----------------

This article from 06/05/2021 they are moving on the Plan, particularly:

"The government in Mozambique has mobilised $280 million to implement its Energy for All programme that will see 400 000 households be linked to the electricity grid for the first time."

"The money was mobilised from the government’s cooperation partners and is intended to provide electrical power to every household in the country."

[...]

"There’s a lot of support from the public. They want access to electricity,” said Bernardo, who recalled that the government’s Five Year Programme for the period 2020-2024 set a target for increasing the number of people with electricity in their homes from 34 to 64 per cent of the population."

https://www.esi-africa.com/industry-sectors/transmission-and-distribution/mozambique-400000-households-to-be-linked-to-electricity-grid/

-----------------

Also, another more recent article, from 01/06/2021:

Mozambique’s president, Filipe Nyusi, on Monday reaffirmed the goal of bringing electricity to the homes of 10 million Mozambicans by the end of 2024.

“Our governance aims that more than 10 million Mozambicans have access to electric light for the first time in their homes by 2024,” he said, considering energy as the key to the country’s development."

https://www.macaubusiness.com/mozambique-president-wants-to-bring-electricity-to-10-million-by-2024/

#NCCL Company at critical negotiation stage regarding tariff. Mozambique's EDM do not require any further info from NCCL for the process. Now all about negotiating the 'price'

Worth saying too that NCCL given go ahead by EDM to undertake more transmission work - a good sign, I would say :-)

Good luck folks!

Let me rephrase that. I am not interested in the EPC and O&M contracts. At this moment in time, I first and foremost interested in hearing the tariff has been approved. Secondly, thereafter, I'm interested in hearing about what the Subscription Price is.

G_G_G

I get your frustration, I feel them too. But the solar project means we have regular meaningful revenues, enough to make a difference. The NCCL team is small. We do not have a huge outlat as a result, though we still do need money to pay Hanno and to cover other programme/project costs, such as outside consultancy. The solar project will contribute $17, 000 per month. That is a very useful proportion of our outgoings covered. So the solar project is relevant. It means that any subseqeuent raise - if required - will not be as deep. Indeed, and you are indicating, it makes sense for SF to arrange that, as it will protect his investment.

Additionally, we are picking up that the Moz government/ EDM do not require any further info for the tariff. We have just heard from NCCL PR that, 'EdM has confirmed there is no outstanding information from Ncondezi for this next phase'. This is significant for me. It means they are at the haggling over the tariff/ the price. This is a major thing, for me.

On the matter of O&M and EPC, while important they are minor compared to tariff and Subscription Price.

Don't think we have long to go.